For a certain company, the cost function for producing x items is C(x) = 40 x + 100 and the revenue function for selling items is R (x) = -0.5(x - 90)2 + 4,050. The maximum capacity of the company is 140 items. The profit function P(x) is the revenue function R(x) (how much it takes in) minus the cost function C(x) (how much it spends). In economic models, one typically assumes that a company wants to maximize its profit, or at least make a profit! Assuming that the company sells all that it produces, what is the profit function? P(x) = Hint: Profit = Revenue - Cost as we examined in Discussion 3. What is the domain of P(x)? Hint: Does calculating P(x) make sense when x = -10 or x = 1,000? The company can choose to produce either 50 or 60 items. What is their profit for each case, and which level of production should they choose? Profit when producing 50 items = Profit when producing 60 items= Can you explain, from our model, why the company makes less profit when producing 10 more units?
For a certain company, the cost function for producing x items is C(x) = 40 x + 100 and the revenue function for selling items is R (x) = -0.5(x - 90)2 + 4,050. The maximum capacity of the company is 140 items. The profit function P(x) is the revenue function R(x) (how much it takes in) minus the cost function C(x) (how much it spends). In economic models, one typically assumes that a company wants to maximize its profit, or at least make a profit! Assuming that the company sells all that it produces, what is the profit function? P(x) = Hint: Profit = Revenue - Cost as we examined in Discussion 3. What is the domain of P(x)? Hint: Does calculating P(x) make sense when x = -10 or x = 1,000? The company can choose to produce either 50 or 60 items. What is their profit for each case, and which level of production should they choose? Profit when producing 50 items = Profit when producing 60 items= Can you explain, from our model, why the company makes less profit when producing 10 more units?
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Transcribed Image Text:For a certain company, the cost function for producing x items is C(x) = 40 x + 100 and the
revenue function for selling æ items is R (x) = -0.5(x - 90)² + 4,050. The maximum capacity of
the company is 140 items.
The profit function P(x) is the revenue function R(x) (how much it takes in) minus the cost function
C(x) (how much it spends). In economic models, one typically assumes that a company wants to
maximize its profit, or at least make a profit!
Assuming that the company sells all that it produces, what is the profit function?
P(x) =
Hint: Profit = Revenue - Cost as we examined in Discussion 3.
What is the domain of P(x)?
Hint: Does calculating P(x) make sense when x = -10 or x = 1,000?
The company can choose to produce either 50 or 60 items. What is their profit for each case, and
which level of production should they choose?
Profit when producing 50 items =
Profit when producing 60 items=
Can you explain, from our model, why the company makes less profit when producing 10 more
units?
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